Thursday, January 30, 2014

Hard times for the British crown

The
other day, my wife was complaining about the high prices of almost
everything that we need for our survival. I agreed with her
immediately because inflation in India, which in raging around 8 or
9%, is hitting the the middle class people like us real bad. For each
and everyone, who has a fixed budget, balancing it, so that whatever
little cash he or she has, sustains him till end of the month, is
becoming a Herculean task and a tough challenge. People are cutting
down consumption of vegetables, meats, milk or whatever they find is
expensive. Things like vacations are already out of the reach of
common people. Even a ticket for a movie, has become very expensive.
In brief, times have become real hard.

This
morning, when I was reading the newspaper, I found out something
which gave me tremendous relief . I immediately told my wife about it
and she surely felt equally relieved. Now, don't get wrong ideas.
Prices have neither dropped in India nor my income has suddenly gone
up. My income as well as the prices stay where they are. Then what
was that news that gave me such a relief? The news was about the
British Monarch; Queen Elizabeth II; queen of England, and it said
that the Queen was facing hard times and was down to her last Million
pounds, just as we were to our last thousand Rupees.

It
appears that the Queen's net expenditure of £33.3m was higher than
the grant ( salary) of £31 million sanctioned by the British
parliament to her in 2012-13. As a result, her household managers had
to draw down £2.3 million from its £3.3 million Reserve Fund,
leaving a balance of only £1.0 million on 31 March 2013, a
historically low level of contingency. It is obvious that the
Monarchy that ruled half the world a century ago and ruled over India
sixty years ago is now down in the dumps as far as money is
considered.

The
funny side of this is that the British Parliament, unhappy with
Queen's expenditure, is behaving like an old timer husband trying to
control his spendthrift wife. For the first time in British history,
a report into royal finances has been brought out in open by the
Committee of Public Accounts, and has asked the British monarch Queen
Elizabeth II to keep a closer eye on how her money is being spent.
The committee's actions much remind me of a novel by Charles
Dickens, published in 1854 and popularly known as Hard Times. The
book appraised the English society and was aimed at highlighting the
social and economic pressures of the times, though Charles Dickens
would have never imagined in his lifetime, that one day his own
Monarch would have to face social and economic pressures of the
times.

Dickens
divides his novel in three separate books and calls them as “Sowing,”
“Reaping” and “Garnering”
and goes on to narrate how everyone, from working class, whom he
calls as hands, to all other classes, suffered in thirteenth century
England. His basic philosophy in this novel is what you sow; you reap
and garner whatever is left. This perhaps is the message, that
British parliament committee wants to give to the Royal household.

The
committee chaired by MP, Margaret Hodge, has studied in details the
income and expenditure patterns of the Royal household and expresses
unhappiness about the present state of the the household in these
words:

"The
Household needs to get better at planning and managing its budgets
for the longer term - and the Treasury should be more actively
involved in reviewing what the Household is doing. Second, the
Household is not looking after nationally important heritage
properties adequately. Back in March 2012, 39% of the Royal estate
was assessed as below what the Household deemed to be an acceptable
condition. Now it is likely to be worse, with some properties in a
dangerous or deteriorating condition."

British
Government gives a grant to the Royal household. The Grant was £31
million in 2012-13 and is set to rise to £36.1 million in 2013-14
and to £37.9 million in 2014-15. In addition to this, it has its own
income generated, which was in 2012-2013, £11.6 million. However the
royal household incurred an expenditure of of £44.9 million with a
negative excess of income over expenditure. For this reason it had to
draw down from reserve funds to the tune of £ 2.3 million.

There
is a famous quote, again from one of the characters of another of
Charles Dickens novel, “David Copperfield,” where Mr Micawber,
gives his recipe for happiness:

Its kind of funny that the
British crown itself does not follow this advice and is bent upon
overspending. Its no wonder therefore that the Parliament committee
has concluded that The Queen has not been served well "by
the Household and by the Treasury, which is responsible for effective
scrutiny of the Household's financial planning and management"
and it wants the royal
household to generate more income and substantially reduce its costs. When I told my wife about this
advice from the British Parliament committee to the Royal household
to reduce household costs, also applies to our household, she was
rather quick to say that I was overlooking the other more important
advice; of generating more income, making me effectively silenced. In
short, it so appears that the British crown's household and my own,
both have fallen on hard times because both of us do not follow Mr.
Miccawber's advice and the way out is surprisingly the same. Ha!Ha!